Sunday, July 29, 2012

During the waiting game that was the Predators deciding weber or not... uh, whether or not to match the offer sheet from the Philadelphia Flyers for Shea Weber, there was a perception among some of the hockey cognoscenti that the Predators would be unable or unwilling to come up with the funds to keep Weber.

The Flyers offer was $110 million over 14 years, with $80 million payable in the first 6 years of the contract. While the AAV under the contract is similar to what Weber was paid this past season ($7.875 million compared to $7.5 million), the contract was structured with heavy front loaded bonus dollars. The perception was that the small market Predators would not be able to match and would lose their Captain and one of their best players.

As you know, the Predators matched the offer sheet and turned perception on its head.

And that may be the seminal moment in the history of this franchise.

There is the fact that the Predators retained their Captain and the services of one the best defenseman in the NHL. That is a positive impact on the ice.

Perhaps more importantly, by matching an aggressive offer sheet, the Predators have begun to change the perception of the organization off the ice to one that can retain homegrown talent as well as one that will pay for elite players.

Throughout their existence, the Predators have been a team that has been...frugal. Cheap sounds so harsh, but perhaps is accurate. Squeezing every dollar and operating just below the mid point of the salary cap have been a way of life for this organization. It is has been in their DNA since Craig Leipold brought the NHL to Nashville.

And that way of doing business has seen homegrown talent depart for greener pastures or traded away in salary purges.

In the process, the Predators have been perceived as a hard working team that would develop young talent that they would eventually lose to teams in bigger markets with bigger budgets. Pat them on the head and thank them for developing talent that other teams could pilfer.

Remember this:

The pundits declaring that Nashville couldn't- or wouldn't- pay for the elite players they had developed.

The expectation was that one if not all of these players would be gone, that the Predators would not pay market prices for their services.

What these pundits missed is a change in the DNA of the organization. After Leipold sold the team to local ownership, they set about to change the way the team did business. First and foremost, they committed to spending the money necessary to retain and attract elite players. Local ownership has the financial wherewithal to to support the team. More importantly, they have a willingness to do so, a fact that was rarely displayed under Leipold's leadership.

The signing of Pekka Rinne ($7 million per year for 7 years), while positive for the team, was taken as an indication that the Predators would have difficulty in signing Weber and Ryan Suter. Well, Weber was signed and Suter was given a very handsome offer ($90 million for 13 years). Although the Predators lost Suter to his bromance with Zach Parise and desire to be closer to his family after signing with the Wild, there was every indication that the organization was willing to match the offer from Minnesota. Suter never gave them the chance, but the fact remains that the Predators were very competitive in their offer.

Lost in the noise about signing Weber is the fact that the Predators signed Colin Wilson to a three year contract and Sergei Kostitsyn to a two year contract at market salaries. These signings are in addition to the new contracts signed by Hal Gill and Paul Gaustad at the start of free agency. This is further evidence of the willingness of the owners to spend the dollars necessary to sign players that the organization needs to be a winner.

The Predators owners have said they will spend to the cap, something this team has never done. These signings indicate that they are serious.

To be certain, the team is just at the salary floor and will have to spend more dollars on players that will bolster the roster. They are no where near the cap, and money will have to be spent wisely to add the right players.

But the team has changed direction, and the signing of Weber is dramatic testimony to that change.

The change in direction for the Predators is one that will define the franchise. No longer will the organization develop talent only to see them snatched away. The Predators are not regulated to irrelevant status when it comes to attracting talent. This signing shows players around the League that elite players are welcome in Nashville and will be compensated on a level that was reserved for teams in larger markets.

And in the process, the Predators are changing the perception of the organization. The expectation is changing to one of a team that will pay to add the players necessary to keep winning and progress to the next level.

And that change in perception and expectations is redefining the team.

Thursday, July 26, 2012

I am on vacation this week, so this week's blog will be a bit shorter and different.

We are hip deep in silly season. No, not free agency in the NHL, but the election cycle that will culminate in the Presidential election in November. Between now and then, we are going to hear a lot of claims and counterclaims, accusations and rebuttals, and a myriad of claims and boasts about the ability to heal our economy. By the time the election gets here, most of us will be grateful that it is over just to get a respite from all the hot air and the BS. As you sort through all the hype and noise, ask yourself this one question: are you better off today than you were four years ago? Actually ask these questions as well: do you believe your future is brighter because of what we have done financially as a country? Do you feel good about your children's future? Think you have the potential for a better standard of living and lower taxes in the coming years? If you answer "no", then all November is about is changing the direction of this country and beginning to restore some sense of responsibility and leadership. And no amount of hype and rhetoric will change what this election is about.

After spending a week at the beach, I have come to the conclusion that our country faces an enormous deficit in... mirrors. Because if we had an adequate supply of mirrors, there is no way that some people would walk out in public looking the way they do.

Have you ever noticed how some people grow on you? Sorta like a fungus.

The beach is great fun, but I really get tired of people trying to roll me back into the water when I am laying out getting some sun.

Tuesday, July 24, 2012

The Nashville Predators have matched the offer sheet from the Philadelphia Flyers for the services of Shea Weber, signing him to a 14 year, $110 million contract. This announcement comes after several days of deliberation by the Predators as the offer from Philly was front loaded with bonuses designed to make it difficult for the Predators to match the offer.

In the end, the Predators stepped up to not only sign one of the best defensemen in the NHL but also to send a distinct message to the Nashville fan base that management is serious about contending for the Cup.

The offer from Philadelphia loads up front signing bonuses to Weber, with $80 million being paid in the first 6 years of the contract. Backed by money from Comcast, the Flyers had the ability to structure a heavily front loaded contract that at first look seemed to make it extremely difficult if not impossible for the Predators to match. There was a sense that the Predators could pay this kind of money to Weber, but the front loading of the contract offer by the Flyers added a financial hurdle that the Predators had to overcome.

For the Predators, this contract represents an inflection point. If the Predators had not matched, the psychological stigma to the fan base and around the League perhaps would have been insurmountable. The Predators would have been perceived as a small market team that could not attract and retain talent. Now the message has been sent that the team is serious not only about continuing to be competitive on the ice, but paying for the talent that can make this team an elite competitor.

To be sure, this is a difficult contract for the Predators to swallow. This was by design. Philly was relying on the financial horsepower of owner Ed Snider's Comcast money to force the Predators to give up Weber. Instead, the ownership group of the Predators showed not only their willingness but their ability to play with the big boys.

And for this young franchise, this is a major step to credibility.

Sure, the Predators have won on the ice. They have been a solid team. But what sets any team apart is the ability to be a destination franchise, willing to pay for the talent necessary to be successful. Until that happens, a team can just hope to be elite.

Now, the Predators have made the step toward becoming a destination franchise. An elite franchise.

Thursday, July 19, 2012

"If you've got a business...you didn't build that. Somebody else made that happen." That was the infamous and inflammatory quote by President Obama this past week about successful small businesses in this country. Once you get past the blindingly stupid and naive nature of this comment, there is tremendous insight in what the President said. And that insight helps us to understand the root cause of so many the problems our country faces. You see, President Obama, Democrats, and liberals of all stripe believe that government creates jobs and wealth. Now, nothing could be further from the truth, as it is entrepreneurs that risk capital and sacrifice time and effort to build a business. Entrepreneurs- industrious and innovative individuals- take ideas and bring them to life as a product or service that has the potential to meet the needs of the marketplace and be successful. And to be sure, not every entrepreneur succeeds. But America's business community is built by people that have taken risks and worked to grow their business and make a profit. Government does not do that. Now to be sure, government provides the security for our country that allows entrepreneurs to succeed or fail; there is a set of laws that are codified and we expect government to enforce them and provide a level playing field. But here is the critical point: government has never once taken a dollar and invested it into a fledgling business opportunity and grown that business and created new jobs. Never. Yet, we have leaders in Washington that have a misguided perspective that government does just that, and it was epitomized by the President's comment. And that view, that belief from the Left creates a contentious conflict that is an impediment to real reform of our tax code and elimination of burdensome regulations that encumber the real job creators. Perhaps it is time for the professional politicians to be replaced by people with real world experience.

It's election season, and I believe that politicians divide their time equally between running for office and running for cover.

Pay close attention to California. Why? Because California is a real life lab experiment that showcases what happens when Democrats run everything. With the exception of the RINO (Republican In Name Only) governator, there hasn't been a Republican Governor since 1996. The Democrats have controlled both houses of the state legislature since 1997. What has been the result? Spending in California has more than doubled, from a state budget of $45.4 billion in 1996 to $92.5 billion in 2012. Income, sales, and property taxes have all been hiked to some of the highest in the nation. So even with all the tax hikes, spending has still outpaced revenue, and Governor Jerry Brown's budget is $15.7 billion in the hole. What does he and his fellow Democrats propose? You know as well as I- raise taxes! Governor Brown proposes raising the sales tax on everyone and raising income taxes on those that make more than $250,000 per year (like President Obama has proposed) . This is projected to raise $8.5 billion, which still leaves a budget deficit of $7.5 billion. And no one in Sacramento knows where that money to make up the deficit will come from. And California keeps on spending, having recently approved a $2.6 billion bond sale to start work on a high speed rail line. Legislators admit they don't know where the rest of the money will come from to complete the rail line, but are going to spend these funds nevertheless. And how has this tax and spend policy worked out for the state? Unemployment is 10.8%; private companies have fled the state and there are fewer private sector jobs today than in 2000. Perhaps most shocking of all, 1/3 of the total welfare recipients in the U.S. live in California, even though the state has 1/8 of the nation's total population. Yes, if you want to see what life is like when the Democrats run things, pay close attention to California. And remember this lesson in November.

In this day and age, common sense is so rare it should be classified as a super power.

I have been seeing a lot of ads on television recently for the Chevy Volt. In these ads, happy smiling people extol the virtues of a car that only requires a fill up once a month or so. That is all nice, but here is what you should know about the Volt. The Volt has a 400 pound battery in it that is dead weight that eliminates most of the trunk space. And there is that little matter of the unsolved battery explosions that have resulted in fires. Once you get past that inconvenient fact, there is the reality that a Chevy Volt is nothing more than the Chevy Cruze with that 400 pound battery installed. The Cruze sells for around $17,000 as compared to the Volt's price tag of $41,000. Even at this price, GM admits they make little to no money on the Volt. The $41,000 price tag is a bit misleading though. Add in the $240 million in Energy Department grants to GM, $150 million in Federal grants to GM's Korean battery maker, and $1.5 billion in incentives and tax breaks and factor that against the number of Volts that have been sold and each one has cost the American taxpayer approximately $250,000. Painful, eh? It gets worse. To tempt consumers to buy this car, the government has been offering an incentive (read: your tax dollars) of $7,500 to buy a car. President Obama wants to up that to $10,000 of your money. And here is the kicker: GM is now going to offer a 60 day return policy. This simply means that once you receive your incentive check in the mail, you can return the car for a full refund. AND YOU GET TO KEEP THE INCENTIVE CHECK! Talk about poor stewardship of your tax dollars. Friends, you now have some sense of why GM and our government are so screwed up. Leaders in both entities are divorced from reality, and they don't care, because it is your money they are spending.

I have reached the age where birthdays just aren't what they used to be. Like...fun.

The Philadelphia Flyers have signed Nashville Predators RFA and Norris Trophy finalist defenseman Shea Weber to an 14 year, $110 million offer sheet. According to details that have been revealed, the contract has in the first four years a base salary of $1 million and a signing bonus each year of $13 million. The fifth and sixth year are $4 million base salaries and $8 million bonuses each year. Years 7-10 are $6 million salary and no bonus. As expected, years 12-14 are salaries of $1 million per year.

The structure of the contract allows for a $7.875 million cap hit per year, slightly above what the Predators paid Weber for this past season.

There are a lot of things to digest about this offer, which the Predators have 7 days to match. Here are some thoughts:

﻿Weber could have told the Predators to trade him, that he would not accept any offer from his current team. I read this course of action as one giving the Predators every opportunity to keep Weber's services for the remainder of his career.

That being said, one has to wonder about the tenor of the negotiations. Had they stalled or were moving at a pace that was unacceptable to Weber and his agents? If so, having his representatives accept an offer sheet would certainly move the process into warp speed.

By accepting offer sheets, it does allow Weber and his agents to define the market for his services. We now know that there is at least one team that is willing to commit a boatload of money up front to acquire this elite defenseman. Philly has defined the playing field for Weber.

The dollars and the AAV are within the reach of the Predators. The real question for the team is can they match the up front money? This is where Snider and the Flyers have the Predators at a distinct disadvantage.

This contract, in my mind, clearly delineates the differences between a deep pocketed owner and an ownership group. Snider has the financial horsepower of the Comcast system while Nashville has a group of owners who, while wealthy in their own right, cannot go checkbook to checkbook with an owner like Snider.

Which means the real issue in the upcoming CBA negotiation is how to balance the deep pocketed owners (typically in the larger markets) and their interests against those that are not so deep or in the smaller markets, or both.

And in the negotiating process with the NHLPA, the contracts to Suter, Parise, and the offer to Weber, have destroyed any credibility that the owners have by claiming poverty and needing to roll back player salaries. Not a wise move by the owners.

If Weber goes to Philly, I had better not see my Comcast bill go up.

So the clock is ticking for the Predators, and the outcome of this decision will affect the franchise for years to come. Sign Weber, and the message is clearly sent that the team is serious about contending for the Cup and attracting and retaining great talent.

Let Weber walk to the Flyers, and Nashville is relegated to also-ran status for years.

Thursday, July 12, 2012

The federal government consistently tells us that the Social Security Trust Fund (SSTF) has enough money to stay solvent until 2033, at which time the fund will not have enough money to pay full benefits. Once this happens, benefit payments will automatically be cut 25%. However, a recent analysis of the fund by Bruce Krasting shows that the SSTF is in danger of reaching the deficit position by 2015. How will this occur? We are all aware that as the baby boomers, which represents the largest demographic in the American population, reach retirement age in increasing numbers the outflows from the SSTF will exceed the inflows from taxes that are collected from a smaller work force. Adding to this problem is the high level of unemployment that has persisted over the past four years and has meant a lower level of taxes that flows into the trust fund. However, one of the greatest threats to the SSTF is the Federal Reserves zero interest rate policy (ZIRP). Here is how that effects the fund: in June of each year, the SSTF reinvests a significant portion of its investment portfolio by investing in special interest Treasury Securities. The interest rate on these bonds is set by a formula that was established in 1960 and is designed to insulate the fund from dramatic swings in market rates by taking an average yield on Treasury Bonds for the past three years. How has that affected the fund? This year, $135 billion of bonds was renewed at an interest rate of 1.375%. That same block of bonds had an interest rate of 5.64%. See the problem? That drop in interest rates cost the SSTF $5.7 billion annually. These bonds have a 15 year maturity, so the fund will be out $86 billion over the life of the bonds. Now the Fed has committed to keeping interest rates at or near zero through at least 2014, and over that period of time, the SSTF has $543 billion in maturing bonds with an average yield of 5.6% If those bonds are renewed at a comparable interest rate, the annual drop in income is $23 billion and $350 billion over the 15 year life of the bonds. The trustees of the SSTF project they will get an average yield of 4% on these maturing bonds. This is a pipe dream, and it is going to affect approximately 72 million people much sooner than anyone is admitting. So the next time you hear that the fund is solvent, know that you are not hearing the truth. And denying these facts is going to be painful for a lot of people that depend on these payments to make ends meet.

Bungee jumping is suicide for indecisive people.

Now that Obamacare is the law of the land, we are beginning to see some of the affects. Perhaps the most startling is the affect on doctors. According to the non-partisan Doctor Patient Medical Association (DPMA), 83% of American physicians have considered leaving their practice because of Obamacare. The DPMA found that the majority of doctors do not believe Obamacare will lead to better access for the majority of Americans. "Doctors clearly understand what Washington does not- that a piece of paper that says you are 'covered' by insurance or 'enrolled' in Medicare or Medicaid does not translate to actual medical care when the doctors can't afford to see patients at the lowball payments and patients have to jump through government and insurance company bureaucratic hoops," said Kathryn Serkes, co-founder of the DPMA. Here is the other problem: even if no doctors do not quit their profession, the United States will face a shortage of 90,000 doctors by 2020. By 2025, that shortage grows to 130,000, according to Len Marquez of the American Association of Medical Colleges. Our country is experiencing a perfect storm in health care: an aging physician population that is not being adequately replaced, and an influx of new enrollees that will come into the system under Obamacare. Government interference in the healthcare market has created and will aggravate serious problems in the delivery of medical services. And the best healthcare delivery system in the world is going to suffer, and we as end users will be the worse off.

I saw a pregnant lady on a bus reading a book entitled "What to Expect". I tapped her on the shoulder and said, "A baby."

President Obama recently proposed extending the current tax cuts only for families making less than $250,000 per year. That plays into the Democrats mantra of "taxing the rich" and playing the class warfare card, but if this were to pass and taxes were raised on those making more than $250,000, the results would be disastrous. Why? Because the impact on small business would be devastating. According to the Small Business Administration (SBA), 99% of the small businesses in the United States will see a tax increase. "So what, they are businesses, they can afford a tax increase," some may say. Consider this: 85% of the workers in the U.S. are employed by small businesses. Think these employers are going to be in a mood to hire new people when they see their taxes jump significantly? Most small businesses are S corporations or Limited Liability Corporations, meaning that income flows through to the owners to be taxed at personal rates. Those entrepreneurs that risk capital to hire and expand their business are going to see more of their profits sucked away in higher taxes if Obama's proposal were to pass. That means less money to hire new employees and expand their business. Do you believe that is a formula to get our moribund economy back on track? Neither do I. The detrimental impact on the economy will be measured in lost jobs, higher unemployment, and no growth. Don't fall for the populist rhetoric. The job creators in this country do not need this type of "gift" from Washington.

Sunday, July 8, 2012

The Nashville Predators and their fans are still stinging from being spurned by Ryan Suter as he took his bromance with Zach Parise and his talents to Minnesota. Being rejected by Suter, the talented defenseman drafted and developed by the Predators, and seeing available free agents sign with other clubs has left a palpable sense of frustration among the Predator faithful.

That frustration has caused many of those faithful to ask if top level talent will come to Nashville.

Seeing a player like Suter leave for another team rekindles the awful memories of the Predators fire sale initiated by then owner Craig Leipold in 2007 as he positioned the team for sale. Watching stars on that team leave for other NHL clubs is painfully etched in the psyche of Predator fans, and there is no doubt that it colors today's outlook.

Then owner Leipold couldn't- or wouldn't- pay for the talent that many thought necessary to win, pleading poverty and mounting losses. As players such as Tomas Vokoun and Kimmo Timmonen were sent to the exits, the Predators were left with filling their roster mainly with their draftees developed in their system.

Fast forward to 2012, and the Predators have seen an elite player depart and questions abound about the future of another star, Shea Weber. All of a sudden, it starts to sound like 2007 all over again.

This time it's different, though.

The Predators now have a local ownership group that has committed to spend to the cap. Look at the offer to Suter, 13 years and $90 million, or consider the commitment to get Weber signed to a market contract, and it can be surmised that the words of the owners have weight.

So if the owners are ready and willing to spend, can Nashville attract the top talent?

Is Nashville a great place to live that becomes a starting point for great players that move on to other clubs or stopping point for fading players in the twilight of their career instead of a destination for elite talent? The answer to that question determines the place of the Predators in the hockey hierarchy.

Sam Page of On the Forecheck wrote a great article here about how the franchise needs to become a destination franchise. His point about moving beyond promoting the quality of life and instead promoting the quality of hockey is THE inflection point in the growth of this franchise. It is time to move to the next level not only in perception but performance.

And therein lies the rub.

Are the Predators in a Catch 22 where they need top talent to win a Cup, but will not get top talent until they win a Cup?

Yes. Sorta.

That doesn't mean that Nashville is permanently locked into the limbo of being very good in the regular season and fading in the playoffs. To get off the treadmill of being good but not great, it means that the team has to do what they did with Ryan Suter.

Open the checkbook to top flight talent.

Make no mistake, the Predators don't have to participate in some of the
silliness that occurs at the trade deadline or at the start of free
agency. But the team has to pay for the talent that
compliments the existing players, talent that doesn't just fill a hole
but makes the team better.

Elite talent.

Obviously, that means that the price is
higher for players that are difference makers.

The Predators have operated on the cheap to this point in their history. Now is the time to change that reality and bring in talent that will take the Predators from the cusp of great to elite. The fact is that if the ownership does not do that- not only this year but for years to come- then the Predators will be nothing more than a good team.

And in the NHL, you have to be elite to win the Cup.

Money obviously isn't the only variable in an athlete's decision process. Coaching, team, and quality of life on and off the ice all factor into a player deciding to cast his lot with a team. The Predators have been very good in all those areas except money.

Until now.

This is a radical change of course for the Predators, and it will take some time for their fans to get used to owners that are ready and capable of spending to the cap.

More importantly, it is going to take some getting used to by the elite players in the League. The Predators have never been engaged in attempting to attract these game changers. Showing them the positives that are in Nashville paired with contracts that are on par with the other major players will, over time, make Nashville a destination franchise.

Thursday, July 5, 2012

One of the little discussed but horrifying realities of Obamacare is that your medical information is no longer going to be private. Yes, I know we all sign the HIPAA privacy notices when we visit our physician, but Obamacare shreds the vestiges of privacy and confidentiality that we have previously enjoyed in the doctor patient relaionship. How so? In multiple ways. First, the IRS is now going to be more intimately involved in the healthcare of you and your family. The IRS is soon going to require your personal health insurance information and all those covered under the plan; the annual cost of your health insurance plan; whether a family member was offered employer sponsored insurance; whether a taxpayer received a credit for health insurance premiums; whether a taxpayer has received a waiver from the individual mandate; and perhaps most onerous of all, private medical and health information about all of us. All of this is to ascertain the amount of any "tax" we owe for not complying with the socialized healthcare program that has been foisted upon us. Now, I don't know about you, but this makes me incredibly uncomfortable to have the IRS involved in my healthcare. It doesn't stop there, though. Our medical history will be entered into a national system with easy access by any healthcare provider, all in the name of providing appropriate health care. Oh yeah, tucked into the abyssmal Obamacare program is a mandate that all insurance companies submit detailed health information about their insured either directly to a centralized registry in Washington or to a state registry that compiles the data and submits it to Washington. Feeling comfortable about your medical information floating around the IRS and other agencies in Washington? Neither am I. While much of the focus has rightly been upon the extraordinary cost of Obamacare, we cannot lose sight of the fact that if it is not repealed, our privacy is shredded under this program. And that is not healthy.

Is it my imagination, or do Buffalo wings taste like chicken?

Do you remember Countrywide Mortgage? They were the largest mortgage company in the U.S. and it could be argued that they were the institution that helped to initiate the mortgage crisis that we are still trying to resolve. According to a report from the House of Representatives, Countrywide made hundreds of discount loans to members of Congress and top officials from government lender Fannie Mae between 1996 and 2008. Countrywide was dependent on Fannie buying the enormous volume of subprime loans that were generated by the mortgage lender, and Congress was considering new mortgage regulations that would have severely curtailed the subprime lending business. Countrywide countered this pressure by making loans at the direction of then Chief Executive Angelo Mozilo that carried a substantially below market interest rate and favorable terms. In the aftermath of the collapse of Countrywide, Moizilo was slapped with a $22.5 million penalty for misleading investors in Countrywide and was barred from ever serving as an officer or director of a publicly traded company. He also paid $45 million to settle other claims of violations of security laws. Countrywide eventually failed and was taken over by Bank of America, which has seen their stock price plummet in the wake of cleaning up the $1.5 trillion mortgage loan portfolio at the time of the takeover. And you and me as taxpayers? So far, we have paid $183 billion to keep both Fannie and Freddie Mac afloat so as not to cripple the mortgage market further. Oh yes, who were some of those that benefitted from the largesse of Mozilo and Countrywide (and eventually you and me)? Here are a few: Former Senate Banking Committee Chair Chris Dodd (D-Conn); Senate Budget Committee Chairman Kent Conrad (D-N.D.) House Armed Services Committee Chairman Howard McKeon (R-CA); Former HUD Secretary Alphonso Jackson; Former Fannie Board Member and Executive Director Henry Cisneros; former HHS Secretary Donna Shalala; and the list goes on. The culture of corruption in Washington is deep and rancid. And you and I pay for it.

"Always" and "Never" are two words that you should always remember never to use.

Speaking of corruption, the hits just keep on coming in the ill fated attempt to push our nation toward ineffective and inefficient "green" energy. And once again, you and I as taxpayers are footing the bill for these failed endeavors. The latest train wreck is Colorado based Abound Solar, a manufacturer of solar panels. The U.S. Department of Energy awarded a $400 million dollar loan guarantee to Abound Solar in December of 2010, and the company had drawn down about $70 million by August of 2011 when the loan guarantee was withdrawn- thankfully- by DOE. The problem at Abound was the inferior quality of their product placed them at a signifcant competitive disadvantage.Regardless of the reason for the company failing, there are two concerns that I have. First, It is amazing to me how quickly after receiving the federal loan guarantees (read: taxpayers on the hook) that these green energy companies are filing bankruptcy. It certainly calls into question the vetting process for these companies. Abound, Solyndra, LightSource, all quickly went into bankruptcy after a brief time at the public trough. The other interesting aspect of these green energy bankruptcies is that a review of the high profile failures all have one common denominator that jumps out. Wanna guess what it is? You already know. They have deep connections to the Democratic Party. Many of the founders have been high profile donors to Obama or to the national Democratic party, and they have been rewarded with your tax dollars. Readers of this blog know that the prime directive is "Always follow the money", and now we are following it from your wallet to the pockets of generous donors to the Democrats. The only real green in this green energy debacle is your green disappearing.

Wednesday, July 4, 2012

The kabuki dance that was the Ryan Suter free agency courtship has finally ended, as Suter has decided to join the Minnesota Wild and his good friend Zach Parise, signing a 13 year, $98 million dollar contract.

The fans of the Predators and of the potential Suters...uh...suitors of the prized defenseman expressed some degree of frustration over the time that Suter took to make his decision, but this was a decision that had many variables that had to be weighed.

One of the factors that Suter said was most important to him was location and being closer to family. Which is interesting, since that had never been discussed with Predators GM David Poile as a primary factor in Suter's decision making process. If location and proximity to family were first among Suter's priorities then one has to believe that Poile may have taken a different approach to dealing with Suter at the trade deadline.

The assertion by Suter that location/family were the key factor in his decision amounts to a blindside hit to Poile and the Predators.

Suter had indicated that the Predators would have an opportunity to give a last offer as a courtesy to the organization that drafted and developed him, but according to Poile, that was not the case.

The offer from the Predators was for 13 years and $90 million.

It remains a speculative point if the Predators would have upped their offer to match the one from the Wild.

They never got the chance.

"I would think disappointment would not adequately describe the word I would like to chose," said Poile. "Disappointed and a little surprised based on all the conversations that we have had."

Screwed is the word you are looking for, David.

Suter had positioned himself for a big payday and not for a moment do I fault him for cashing in. Every athlete at the professional level wants to get paid for the sweat, sacrifice, and effort they put forth. Rising to the pinnacle of their profession demands compensation commensurate with that effort.

Nothing wrong with that.

However, if location and a desire to be closer to family were THE critical variables in Suter's decision, then the Predators were at a disadvantage from the word go. The money that the Predators would have to offer to overcome that disadvantage would have to be phenomenally greater than what the Wild could offer.

Again, it is just speculation as to whether the Predators would have done that.

What is certain, though, is that Poile would have managed the trade deadline differently if he had known that the Predators had to overcome this handicap.

That handicap was not known by Poile or the Predators as Suter did not indicate that it was a primary factor in his decision.

Surprise!

Poile said that Suter held all the cards as the free agency deadline approached. By trusting Suter to negotiate honestly with the Predators, Poile gave up all leverage and the cards in his hand by letting the trade deadline pass with no action.

If, as Suter has said, being near his family was paramount in his decision, then Suter ran a hell of a bluff on Poile.

We can all speculate about the nature of the conversations between Poile and Suter based on the snippets that have been released into the public domain. We can spend time guessing as to whether or not Suter really intended to come back with the Predators.

All of which are a fool's errand.

What we know is that the Predators believed a player when he said that his team would have every opportunity to retain his services.There was risk in that belief and action, but the Predators had confidence that it would be reciprocated with legitimate negotiations by Suter.

It appears that confidence may have been- at least to a degree- misplaced.

So now Suter and the Predators move on.

And for the Predators, this experience will shape negotiations with future pending UFA's, notably Shea Weber.

And Predator fans should expect something entirely different in this process.